Facebook expected to hold off on IPO
Looks like Mark Zuckerberg has things on his mind other than Facebook鈥檚 initial public offering.
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The Facebook team announced plans to go public on Feb. 1st, inspiring a frenzy of excitement among users and investors. it would probably take until mid-May for Facebook stock to arrive on Nasdaq.
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Now that May has arrived, sources have alleged that Zuckerberg 鈥� who announced Facebook鈥檚 plans to buy photo-sharing app Instagram for $1 billion in cash and stocks last month 鈥� is more concerned with acquisitions and 鈥渞unning the business鈥� than the IPO,.
Facebook鈥檚 decision to put off the IPO may be a smart one. Because of the Instagram acquisition, as well as the $550 million purchase of 650 Microsoft patents, Facebook has to reevaluate the company鈥檚 worth and potential growth. The Securities and Exchange Commission will need Facebook to file updated information about the acquisitions before approving it for public trading.
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Facebook announced Tuesday that 鈥渢otal revenues [came] in at $1.06 billion, up 45 [percent] year-over-year, but down compared to the $1.3 billion booked in Q4,鈥�. This inspired 鈥渁t least one analyst to lower their valuations of the company,鈥�.
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Economist and analyst Max Wolff of advisory firm GreenCrest Capital that Facebook鈥檚 reported revenue is less than expected.
鈥淸What] they鈥檙e putting out are very strong numbers, but they鈥檙e not quite living up to the discussion that have stratospheric valuations above $100 billion,鈥� he said.
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Facebook is now looking at other plans for the IPO, a source told CNBC.
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It鈥檚 still impossible to predict how Facebook will fare once shares start trading on Nasdaq. Some have called the social media giant 鈥渢he new MySpace鈥� and warn others that the next big social network is around the corner. Others say potential investors should simply wait to purchase shares until Facebook has been public for days or weeks.
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But this might be a moot point. It鈥檚 highly likely that the average investor will face tough competition from institutional investors and well-connected clients,.
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As for now, all we can do is wait and see what Zuckerberg does next 鈥� and as we鈥檝e seen, it鈥檚 usually unexpected.
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